Killing the Golden Goose

The Washington state measure includes a 25% tax imposed when the grower sells marijuana to a processor, again when the processor sells it to a retailer, and a third time when the retailer sells it to a customer.

Supporters estimated it would raise as much as $500 million for the state — a figure analysts say is overstated.

John Chambers, head investigator for the Illinois Department of Revenue, says cigarette smuggling now rivals illegal drug smuggling, and street gangs are getting involved.

“Keep in mind this is very similar to drug activity, smuggling drugs, and there could be concealed compartments, false floors in the bed of a truck, much like drugs, all packed with cigarettes,” Chambers said.

With Chicago, Cook County, and Illinois taxes all included, smokers now pay $4.66 a pack in taxes in Chicago. That’s the second-highest cigarette tax in the nation, trailing only New York City at $5.85. People looking to make quick cash don’t need to travel far to buy cheap cigarettes. Indiana’s tax is just $0.995 a pack, and Missouri’s tax is the lowest in the country at just $0.17. Chambers says cigarette smuggling is now as lucrative as drug smuggling, with much lower penalties.

Right now recreational marijuana is a total loss to the public coffers. The sale isn’t taxed, and further tax monies are used to arrest, prosecute, and punish people engaged in the trade. The obvious solution is legalize it and tax it…PROFIT!

Only when you pile the taxes to the skies, while the illegal pipeline still exists, people will just keep buying form the black market. You have a golden goose there, but you’re just slaughtering it, and rather than golden eggs, you’re getting goose meat.